Loan against property is one of the simplest components of banking. Taking a loan against property means, you can avail a loan by holding your property as security. Banks generally offer this loan against your property, which can be a residential apartment, a commercial building or even a piece of land. You will only be able to avail this loan by mortgaging your property, and your loan amount will depend on the type of the property you will be mortgaging.
Best situations for applying for a loan against property
The ideal circumstances when you can apply for a loan against property are the following:
• Sponsoring wedding expenses of family members
• Sponsoring your vacation plans
• Funds for your children’s higher education
• Expansion of business plans and operations
• Payment of hospital expenses and bills
Eligibility criteria for applying for a property loan
In order to apply for a property loan, you will have to fulfil the eligibility criteria. However, the eligibility criteria are different for different people and their designations and are as follows:
1. Professional
• The applicant cannot be aged more than 65 years
• The applicant can be involved in any field i.e. engineer, doctor, lawyer, chartered accountant, architect etc.
2. Salaried employee
• The applicant must be at least 25 years old to avail this type of loan
• The applicant should be a permanent employee of a reputed company or the government
3. Self-employed individuals
• The applicant must be a part of the same business for at least 3 years to 5 years
• The applicant must be regular when it comes to filing income tax returns
Eligibility of property- The concerned property should not have any illegal aspect to it and must be free from any legal problems and complications. Your property must also have clear and legal titles registered in your name.
Benefits of a loan against property
The advantages of property loans are numerous. They are as follows:
• Since property loans have high tenures, you can pay them off in the form of EMIs and the repayment period ranges from 10-15 years
• Property loans charge reasonably low-interest rates i.e. 12% to 15% compared to personal loans, which charge around 15% to 25%
• As property loans are secured loans, they are comparatively easier to get than other types of loans
• Property loans charge very little to no prepayment charges
Documents required for a loan against property
You will have to submit the following documents if you are applying for a property loan:
• Identity proof validated by the government
• Self-employed people must furnish their financial statement of the last 3 years
• Accurate proof of your residence
• Salaried employees will have to furnish their salary slips of the last 6 months
• Copy of the recent bank statement
• Self-employed people will have to provide proof of the existence of their business profile
• A duly filled application form with a recent photograph of the applicant
• Processing fee cheque
• Copy of income tax returns
• Copy of details of all your current loans
• Self-employed people will have to provide proof of their educational qualification
• Every property related documents you have, including the approved building plan, needs to be submitted
Before you choose to go for a property loan, make sure that you have all the important information regarding it. This will help you make an informed decision; otherwise, you might end up failing to repay your debts.
Best situations for applying for a loan against property
The ideal circumstances when you can apply for a loan against property are the following:
• Sponsoring wedding expenses of family members
• Sponsoring your vacation plans
• Funds for your children’s higher education
• Expansion of business plans and operations
• Payment of hospital expenses and bills
Eligibility criteria for applying for a property loan
In order to apply for a property loan, you will have to fulfil the eligibility criteria. However, the eligibility criteria are different for different people and their designations and are as follows:
1. Professional
• The applicant cannot be aged more than 65 years
• The applicant can be involved in any field i.e. engineer, doctor, lawyer, chartered accountant, architect etc.
2. Salaried employee
• The applicant must be at least 25 years old to avail this type of loan
• The applicant should be a permanent employee of a reputed company or the government
3. Self-employed individuals
• The applicant must be a part of the same business for at least 3 years to 5 years
• The applicant must be regular when it comes to filing income tax returns
Eligibility of property- The concerned property should not have any illegal aspect to it and must be free from any legal problems and complications. Your property must also have clear and legal titles registered in your name.
Benefits of a loan against property
The advantages of property loans are numerous. They are as follows:
• Since property loans have high tenures, you can pay them off in the form of EMIs and the repayment period ranges from 10-15 years
• Property loans charge reasonably low-interest rates i.e. 12% to 15% compared to personal loans, which charge around 15% to 25%
• As property loans are secured loans, they are comparatively easier to get than other types of loans
• Property loans charge very little to no prepayment charges
Documents required for a loan against property
You will have to submit the following documents if you are applying for a property loan:
• Identity proof validated by the government
• Self-employed people must furnish their financial statement of the last 3 years
• Accurate proof of your residence
• Salaried employees will have to furnish their salary slips of the last 6 months
• Copy of the recent bank statement
• Self-employed people will have to provide proof of the existence of their business profile
• A duly filled application form with a recent photograph of the applicant
• Processing fee cheque
• Copy of income tax returns
• Copy of details of all your current loans
• Self-employed people will have to provide proof of their educational qualification
• Every property related documents you have, including the approved building plan, needs to be submitted
Before you choose to go for a property loan, make sure that you have all the important information regarding it. This will help you make an informed decision; otherwise, you might end up failing to repay your debts.
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